Foreign holdings of U.S. Treasuries rose to $9.045 trillion in May, maintaining levels above $9 trillion for a third month, according to Treasury Department data released Thursday.
The increase came after a dip in April, when tariff-related uncertainty prompted a pullback.
On a transaction basis, foreign investors bought $146 billion in Treasuries during May, reversing an April outflow of $40.8 billion. That month, new tariffs announced on April 2 triggered market volatility and weakened demand.
The May purchase marked the largest monthly inflow into Treasuries since August 2022.
Japan remained the top foreign holder of U.S. government debt, raising its holdings to a record $1.135 trillion. The United Kingdom, now the second-largest holder, increased its position to $809.4 billion from $807.7 billion in April.
China cut its Treasury holdings for a fourth consecutive month, reducing them to $756.3 billion in May, the lowest since February 2009. Its holdings have declined significantly from a peak of over $1.3 trillion in the early 2010s.
Canada raised its holdings to $430.1 billion from $368.4 billion in April, after selling in the previous month when new U.S. tariffs targeted Canadian steel, aluminium, and automobiles.
Foreign investment in U.S. equities also rebounded strongly in May, with net inflows of $114.3 billion compared to an outflow of $18.8 billion in April.
Net capital inflow into the U.S. totalled $311.1 billion in May, the largest since September 2024. After accounting for adjustments like stock swaps, total net foreign inflows into long-term U.S. securities reached a record $259.4 billion.
